Big Oil CEOs on Capitol Hill defend profits, tax breaks *updated*

Executives from the nation’s five biggest oil companies are telling a Senate panel this morning that they should not be blamed for spiking crude prices and that proposals to raise taxes on their firms will suppress domestic energy production.

Congress must “balance the potential implications of increased industry costs on both supply and price,” Odum said. If proposed tax hikes are scratched in favor of increased access to domestic energy resources, “we would see tens of thousands of new, well-paying jobs and billions of dollars in revenue for local, state and federal governments.”

“If we don’t develop our own energy sources, we’ll have to accept the costs — both financial and geopolitical — of bringing it into this country from places that are less secure or less stable,” Odum said.

Chevron CEO John Watson insisted that the oil and gas industry already “pays its fair share in taxes.” He reprised an argument ConocoPhillips made to shareholders Wednesday that the worldwide effective tax rate for the industry was about 40 percent. Chevron alone paid the government $86 million each day between 2005 and 2009 in taxes, royalties and fees, Watson said.

Watson also made the case that that the targeted tax deductions have parallels in other industries and that eliminating them only for the five biggest oil companies would be unfair.

“There should be equitable treatment for all forms of energy and for all energy producers — large and small,” Watson told the Finance Committee. It is “anticompetitive and discriminatory” for the Senate to single out five companies because of their size.

“Arbitrarily punishing five U.S. oil and gas companies by raising their taxes will generate far less government revenue than if we were allowed to compete and produce our nation’s resources,” Tillerson said.

James Mulva, chairman of Conoco Phillips, illustrated how taxes play a role in the company’s investment decisions. Higher U.S. taxes would give a further advantage to foreign competitors.

Lamar McKay, president of BP America, stressed his company’s investments in renewable energy and alternative fuels.

He emphasized the importance of a “stable and competitive tax framework” for the U.S. to remain attractive in a global competition for capital investment: “Changes to tax rules being contemplated would limit the amount of resources companies like BP have to invest, not only in conventional energy production but also in new and emerging technologies like wind, biofuels and solar.”

But Senate Democrats argued that the tax deductions amount to wasteful and ineffective corporate subsidies.

“Businesses should of course make a profit. That’s the American way. It drives our economy,” said Sen. Max Baucus, D-Mont., the Finance Committee chairman. “But do these very profitable companies actually need taxpayer subsidies?”

Baucus also dismissed arguments that slashing the tax breaks for the biggest oil companies would suppress their investment in domestic exploration and production.

“Given profits of $35 billion in just the first quarter alone, it is hard to find evidence that repealing these subsidies would cut domestic production or cause layoffs,” Baucus said. “After all, based on first quarter profits, these tax breaks represent less than two percent of what these companies are on pace to make this year. Even without these tax breaks, these companies would clearly be highly profitable.”

Sen. Orrin Hatch, R-Utah, accused Democrats of engaging in political theater “to score political points” and “to distract Americans from their failure to develop a coherent energy policy.”

Hatch said that singling out the oil and gas industry because of high crude prices would set a bad precedent.

“Are we to increase taxes any time a company sees an increase in quarterly profits due to high demand of a commodity?” Hatch asked. “What if Wal-Mart’s profits increased due to a spike in global demand for cotton? What if an increase in demand for coffee results in Starbucks reporting record profits?”

The hearing was at times combative, with Sen. Robert Menendez, D-N.J., blasting Mulva for his company’s assertion in a press release Wednesday that the tax proposals were “un-American.”

Rockefeller said the business leaders seemed oblivious to the tough federal deficit-cutting decisions facing lawmakers.

“Not once during this hearing have I heard any semblance of a willingness to share unless every company also has to,” Rockefeller said. “I haven’t heard anybody talk about what they are doing — what they would be willing to do — to share in our budget problem. The total concept of what keeps America together . . . is a sense of fairness, that everybody has to lose at some point, everybody has to give something up to be a real country.”

Watson rejected that ideology. “The American people don’t want shared sacrifice,” he said. “I think the American people want shared prosperity.”

Senators repeatedly — and unsuccessfully — pressed the executives to define at what price or profit margin the oil companies would be willing to cede the deductions.

Sen. Olympia Snowe, R-Maine, questioned if there was “a price point at which we remove these incentives.”

Rockefeller asked “how much profit on a barrel of oil do you have to make to not be needful of these subsidies?”

And Sen. Debbie Stabenow, D-Mich., made another attempt: “What would it take, in level of taxpayer subsidies, for you to bring our gas prices down?”

Tillerson insisted that the current tax structure is designed “to incentivize and help people go out and invest in the next incremental barrel of supply.” That can be upended, he said, but the cost would be additional production.

“If you don’t want the incremental supply, you can make the tax structure higher and the next incremental barrel doesn’t get developed,” he told Stabenow.

Watson said that oil companies don’t need a handout, but do require “a reasonable return on our investment.”

The Senate Democrats’ bill would block the top five major integrated oil companies from claiming:

A tax credit on payments to foreign governments — including petroleum income taxes — that they pay in exchange for some economic benefit. The five biggest oil companies would still be able to deduct foreign payments.

A domestic manufacturing deduction, which has generally been available to a broad range of U.S. firms.

A deduction for intangible drilling costs, such as the cost of repairs, site preparation and hauling supplies. Currently, integrated oil companies can expense 70 percent of the cost of these intangible drilling costs, but the legislation would require the big five oil companies to instead capitalize all of these costs.

A percentage depletion deduction for oil and natural gas wells, computed using a portion of the revenue from the sale of those hydrocarbons.

The bill also would limit the deduction of certain tertiary injectants, chemicals used to boost the amount of oil and natural gas that can be recovered from individual wells. Currently, companies are allowed to deduct the cost of those injectants, but the bill would force the big five oil companies to instead capitalize those costs and recover them over time.

131 Responses

It’s real simple to me. Media manipulated public awareness is the first shot. Then oil is jacked up followed by gasoline THE NEXT DAY!! As the attention fades oil is held high. Once it’s painfully clear they are illegally high due to price gouging…. ah haaaa… oil prices drop drasticaly. However.. this is only pacification of the masses giving hope that the KEY MONEY MAKERs “Gasoline and Disel” will soon drop in relative ratios in which they rose. But all for not.. Oil prices dropped weeks ago but what with gas and disel… hell they went even higher. Why? the next CNN, FOX ABC NBC negative reporting on the floods. WOW. If oil is cheaper today.. gas must be tomorrow. MUST BE!

Any company making 10 billion profit in 3 months from raising prices of a critical life supporting comodity for the hard working American is criminal.

Even worse, their competitors are right along with them. Isn’t that price fixing? I thought federal laws made that illegal and the FTC is charged (by the american public that employ them) to detect and prosecute law breakers as such. “You’re Fired”

Wow now lets give them Billions more dollars from those same working, tax paying Americans.

Ralph, “everybody’s doing it” doesn’t make it right. Technically, there is a “means test” for every tax bracket, but there are many loopholes for those who can afford them. That’s how these oil companies (and MANY others) avoid paying taxes in this country…and often get tax benefits. If our gov’t would enforce the laws the way they should be intended, and corporations paid their share in this country…our debt/financial situation would likely be much better off. I like your comment, but there is plenty of reason to “whine.”

Mike R, thanks for your feedback, too. I think this is one of the most, if not THE most important issue facing us today. I like your statement regarding how we used to be as opposed to now. I’m often reminded of how this country’s “motto” seems to have gone from “do unto others as you would have them do unto you” to somewhere between “get rich or die tryin” and “move b**ch, get out the way.” Society is not even close to the same as it was just 20 years ago. I think a lot of that has to do with the internet and the “mainstreamization” of garbage from TV, music, politics, etc. where heart and soul and the human element in general have almost completely been ripped out of our mainstream society…and have been replaced with this dumb, thoughtless, rude, greedy, self-promoting enigma that has pretty much taken over this country. I think our “leaders” prefer it that way…it keeps us dumb and/or distracted from the real takeover that’s been going on over the last few decades that is the transfer of wealth from the middle class to the rich. As long as we’re “busy” watching Jersey Shore, “listening” to Lil’ Wayne, arguing/fighting about democrat/republican, etc., we will continue down this spiral that is “leading” us further into debt/poverty.

THAT being said, I disagree that “going after the oil companies are embracing a philosophy that in the end harms them in the end.” People have different ideas…we may disagree…but no other real options have been put on the table as far as an “alternative” national transportation system. Hell, we can’t even get a local or regional one going here in Houston and Texas. We’ve put one street level rail line in that took away two lanes and a center lane of Main St., makes everyone stop at every part of most intersections, and prevents us from turning left onto or off of Main St. It’s a freaking joke. It seems to me like those who are making these decisions WANT us to sit in traffic, waste gas, drive on streets that need more maintenance than Jocelyn Wildenstein’s face…and they also don’t seem to mind the roughly 250 MAJOR accidents (“major” defined as at least $1,000 damage, injury or death) every DAY in the Houston metro area alone. That’s not a typo. There was an article about that on chron.com a couple of years ago…and I bet I can still find a link if you’d like. We drive vehicles that range in size from motorcycles to 18-wheelers on roads with merging lanes at high speeds…our upkeep and construction practices are laughable at best, and criminal negligence seems like at least a decent likelihood. One of our latest gems from a plethora of examples of this has been Kirby between 59 & Richmond.They tore up that section of Kirby…a VERY busy area…2 or 3 months ago. We haven’t had any rain pretty much the entire time, and they STILL haven’t done anything there since. That’s what they do. They’ll block off whatever section they’re going to work on…they may or may not actually tear it up…(or sometimes they’ll put that BS temporary rock/gravel mixture in small spaces that sometimes creates bumps that require new shocks for every vehicle that drives over the “temporary fix” and is 10 times worse than the pothole they’re supposed to be “fixing” in the first place)…and then they’ll let it sit, often for months at a time…and when they do get around to fixing the problem…the finished product is too often in as bad of shape as it was before they began their work, and sometimes worse. These aren’t isolated events, this is standard practice. This happens all the time. I’ve been a courier in Houston for over a decade now, and over the years, I’ve noticed how corrupt our oil/automobile industry is, and just how much of a stranglehold they have on our economy. They obviously don’t care about our safety (about 2 people die every day in Houston from auto accidents…and over 40,000 Americans die every year from them), but they obviously do care about making money. They have rigged our economy so much in their favor via local, state, and federal political bribery and advertising/PR. I love driving as much as anyone else, but radical change has been long overdue. The question is, what’s it gonna take?

Sorry for the long post (and I hope you’ve hung around long enough to read it), but to get back to your point, I just don’t see how getting rid of our oil AND auto industry would “harm us in the end.” In fact, I would say the opposite. The gas…the insurance…the car payments…the maintenance/upkeep…the pollution that creates so many other problems (environment, personal health, and financial) … the traffic…the construction…the bumps/potholes…the road rage…the fact that our lives are in the hands of thousands of other drivers every day, many of whom are distracted by signs, billboards, trying to find addresses that are often not visible or even there (how the hell is that legal?), talking on the phone, texting, eating, listening to music, etc. … the traffic laws/citations that lead to our municipal court systems that are often backed up for months, and even years, etc. … and there are so many little things as well…the traffic signs/signals…the different sized vehicles that lead to extremely poor visibility (no one driving a car can see past the vehicle ahead of them if it’s a truck or SUV) … or how about when we’re sitting at a light 3 or 4 cars back, and you KNOW that when it turns green, you’re gonna have to wait for at least at least a little longer than you should before you and everyone behind you can proceed because one of the dipsh*ts ahead of you isn’t paying attention…or how about when you just need a foot to get in the next lane, or U-turn lane, or driveway, and the guy ahead of you has a whole car length between him and the guy ahead of him, and he won’t scoot up one inch, possilbly keeping 10 or 20 or more people behind you from being able to proceed, while also backing up that intersection (or if it’s off a nearby freeway exit ramp, that ONE a-hole could be holding up enough cars to create backups on the freeway itself) … I can go on and on. We can easily build a REAL local, regional AND national rail system if we wanted to. Unfortunately, our politicians (from both parties) are bought and sold by the oil lobby (as far as the transportation industry is concerned…of course they are bought and sold by other interests as well…the banks…the pharmaceuticals…etc.) They’ve had the market cornered in this country for decades. People have been waking up more and more over the years as these realities have become uglier, and especially since gas has gone up…but the progress has been limited. Our overall fuel efficiency has increased very little over the last few decades. We continue to build cities further and further out and promote as much consumption as possible w/o actually SAYING “we want you to consume more of our BS products at whatever cost is ‘necessary.'” They advertise gas consumption in the form of giant truck commercials (as if anybody NEEDS one in the first place) during every major prime time event (especially sporting events where they know they can count on their predominately male audience to the point that they actually try to convince them…and it works…that they may or may not “have the balls” to own this giant truck that’s driving through either the frozen tundra, or the desert, or through some flaming obstacle course…you know…pretty much ANYWHERE BUT rush hour traffic in a large city where they’re actually going to be driving most of the time). They continue to rip us off, and they continue to pay off our politicians at every level of gov’t to keep it that way. It’s obvious…not much has really changed…yet the situation continues to become more dire every day. The price of gas, the wars over oil, the pollution…and for what? So we can waste $5 or $10 every day on our way home to inhale diesel and contribute to the wealth of the wealthiest people on Earth who are largely responsible for this sh*t? No “thanks.” Even poor countries in Europe have more advanced transportation systems than we do in some of our largest cities…especially in the South. Any real alternative to oil/automobiles certainly hasn’t been tried to this point…at least on a large scale in this country…but it’s no secret that cities with REAL rail/subway systems are widely accepted as superior to those that don’t as far as transportation systems are concerned. My question to you is…how does letting the oil (and auto) companies run wild NOT “harm us in the end?”

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ColoNative, how much did Exxon pay the U.S. from income taxes? What about their tax benefits? How much did they pay to bribe politicians from both parties?

All this whining about not paying taxes… sheeesh. Face it.. it is your tax code that is at fault. The oil companies are “just” doing what all the other rich folk do.. taking advantage of all the deductions they can.

You have a “means test” to establish the right to food stamps.. low income housing etc.. Your debt problems would be solved if you came up with a means test related to tax deductions allowed.

toddieie
May 13, 2011, 10:24 AM
How stupid can Americans Get??? To buy into the PROPAGANDA that the Oil Companies Tout.

NO REASON FOR HIGH OIL PRICES…only to line the stockholder…WHAT A GREEDY SHAME.

Jobs created………….like hell! More jobs created means more expense…no way thats going to happen.

Quit pissing down on us, and saying its RAINING. Oil Companies should PAY MORE TAXES…or…JUST PAY TAXES ON THE INCOME !!!!!!
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toddieie, your right, HOW STUPID CAN AMERICANS GET? TO BUY INTO THIS PROPAGANDA THAT THESE SENATORS and this ADMINISTRATION TOUT!

You should buy a basic book on Economics. Read the chapter on how supply impacts pricing. If you regulate that certain States have to only use certain cocktail blends of refined gasoline, and you regulate capacity of refineries to make these special blends, and if you don’t allow oil companies to drill (in the gulf) and then you devalue the dollar forcing worldwide crude oil prices to rise, then guess what? Prices go up!

Your comment about JUST PAY TAXES ON THE INCOME? EXXON paid $28.5 billion in sales based taxes and $21.5 billion in corporate income TAXES in 2010. This does not include payroll taxes and property taxes paid in 2010. Chevron paid $18.1 billion on “other taxes” and $12.9 billion on corporate income TAXES in 2010.

AnimuX
May 12, 2011, 12:32 PM
Don’t worry. Republicans will do everything in their power to save their biggest campaign contributors and screw the American people.

I don’t want my tax dollars to go to subsidizing oil companies when Republicans are asking (or forcing) all of us to make sacrifices because they continue to cut taxes for the richest of the rich.

Big oil is raking in record profits. They don’t need any tax breaks.
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Animux, a couple of things. First of all, I don’t want my tax dollars going to SUBSIDIZE alternative energy solutions that are not economically viable and won’t help me! Second, raking in record profits? Let’s examine record profits. As a percent of sales revenue, Oil company profits for the last several years average 6% to 9%. Now, let’s examine some Corporations that are coveted by many Americans (some of these Idolized by the Left) without ANY CRITICISM about the kind of profit levels they’ve earned over the last couple of years: P&G 15-17%, Coca Cola 18-33%, GOOGLE 19-29%, Microsoft 24-29%, APPLE 19-22%. Seems pretty outrageous compared to these Oil Company earnings, doesn’t it? Finally, let’s look at General Electric, one of OBAMA’s biggest supporters. They had reasonable profit margins of 7-10% over the last several years. But, as far as subsidies (that’s what Senators and Congressmen call tax legislation that they voted for) are concerned, General Electric took advantage of those tax “loopholes” and hasn’t paid any corporate taxes in 5 years!!

You make a good point in absolute terms yes not all are Democrats but I still make my point that these folks going after the oil companies are embracing a philosophy that in the end harms them in the end. Its interesting how our country has evolved downward. We used to be a country that if you wanted more wealth then go exercise your freedoms and go create your own. But now we have the culture of envy, class warfare that if you want more go pick your neighbors pocket. Its easy to steal other peoples money via political process but in the end destroys the country.

Peter, I never SAID he said anything about the democrats. I ASKED you when he said “ONLY the republicans”…which he didn’t. You put those words in his mouth. Just because AnimuX was “pointing the finger at republicans”…that doesn’t mean he thinks ONLY republicans do those things. Your “I think Paul is smoking crack” comment actually illustrates my point…not literally, of course;)

I don’t care about profit margins…but generally, I think nobody by today’s standards should make more than about 2 or 3 million dollars per year…and I also think minimum wage should be around $15/hour.

Paul, AnimuX said “Republicans will do everything in their power to save their biggest campaign contributors and screw the American people.” and “…when Republicans are asking (or forcing) all of us to make sacrifices because they continue to cut taxes for the richest of the rich.”

Where did he say ANYTHING about the Democrats?

If I say “I think Paul is smoking crack” does that also mean I think lawaggie does as well even though I only pointed out you and never specifically excluded him?

AnimuX is clearly pointing his finger at Republicans saying they are in the pocket of big oil due to contributions. It doesn’t matter if you close your eyes, cover your ears and scream “lalalalalalala”.

OH MY!!!

That must be embarrassing to you.

BTW, Paul, would you mind sharing with us what you feel is an acceptable profit margin?

Its another sad fact that the posters who are bashing the oil companies are their own worst enemy. Their lapping up the Class Warfare Koolaid being served by the Democrats will deliver these liabilities to them:

+ Higher Unemployment & especially reduction in good middle class jobs
+ Higher Gasoline/Energy Prices (Yes Tax Hikes are Passed On Its a Fact)
+ Higher Prices For Food, and any Consumable you buy. Its part of the cost for transporting and/or manufacturing any product.
+ Attacks the value of mutual funds held in IRA’s and 401K’s for people wanting to retire.
+ Increases dependence on imported oil that also partially funds terrorism and undermines national security.

I mean these people bashing the oil companies and playing the class warfare card are their own worst enemy. Them embrace a philosophy that is going to harm them back. These people kind or remind me of a person that has a headache beating themselves in the head with a hammer to get rid of the headache. And they don’t stop they just keep doing it and their head hurts worse and worse. Simply amazing.

“Oil companies arent going to “slow down” exploration nor production.” Really Richard. Where do you get your information cowboy? There was a dramatic “slow down” in exploration from 1985 until sometime 2001. As a matter of fact, there was a saying in the patch something to the effect that “please G-D give us another boom, and I promise not p1ss it off this time”

viejo, Exxon’s own website shows different total employment numbers than the ones that are shown in your Fortune Magazine article. They did finally increase their total number of employees in 2009 (from 79,900 to 80,700) and 2010 (from 80,700 to 83,600. My statement was a little outdated…but between 1998 and 2008, they enjoyed the top ten quarterly profits in history, and yet they decreased their total number of employees every year during that span.

Grover Norquist famous for his cutting government to the point that it can be drowned in the bathtub has outdone himself with the twisted logic of equating the ethanol subsidy with increasing taxes.
P.S. This subsidy was started when oil cost was a fraction of the amount now and in order to encourage production. Now they have plenty of incentive with the high cost without an additional subsidy.

The statistics are laying to you Richard. And you are misrepresenting the both the Hughes rig count and the article you cited. As Baker Hughes has said, the rig count peaked in 1985 with some odd 4,500 land rigs operating, and as the young man graduating said “I’m just glad I didn’t graduate last year”. Implying that there was not much hiring going on in the energy sector, until recently.

I really feel sad for my country when I see the ignorant comments from the people bashing these oil companies for making a profit. Its like the Democrat senators can make a robo call to their uneducated stupid and ignorant masses and play the envy or class warfare card and these poor ignorant people just gobble it up. And to witness such a huge display of ignorance of economics and the facts as to what makes a society richer. I think this country is doomed for too many of these posts can be classified as just irrational envy fueled by total ignorance. It even underscores the point when just last week I encountered a 16 year old kid who was living on a Liberal Plantation and could not figure out their right from their left arm. Groan.. This country is in deep trouble.

I am always amazed by how many Americans believe companies are like Uncle Scrooge McDuck in that they have a giant money bin behind the corporate offices. NEWS: They don’t. When the government raises a corporation’s TAXES, the corporation responds (since there is no giant money bin) by RAISING CONSUMER’S PRICES. Socking it to the corporations SOUNDS great, but corporate taxes are “full of sound and fury, signifying nothing.” CORPORATIONS DON’T PAY THEM!

Facts, 3/25/2011 Baker Hughes reported that there are now 851 oil rigs drilling in the US. That is the highest level since Baker Hughes started counting 24 years ago. In February API reported that US crude oil production is at a historically high level of 5.428 m/b/d. Right now both those numbers have gone up. As for jobs,
OFFSHORE TECHNOLOGY CONFERENCE
Yes, they’re hiring Brightening energy job picture keeps industry’s recruiters busy
By BRETT CLANTON HOUSTON CHRONICLE May 4, 2011, 9:52PMhttp://www.chron.com/disp/story.mpl/business/energy/7550947.html

What many fail to recognize is that the price of oil has fluctuated substantially in the past. (At least during my entire adult working life) This is a cyclical industry. When I first started out, the rig count climbed to over 4,000 land rigs running, and a young engineer would have multiple job offers. Now we have half as many rigs running, and I have no headhunters knocking on my door. The big oil companies may be showing record profits at this time, but the price of oil could collapse once again, and what will happen???? Will Congress come out to help out the oil industry because it is to big to fail too? I doubt it.

Oil companies arent going to “slow down” exploration nor production. They’re not going to go overseas neither, partnering with Russian state owned companies? How about Nigeria? Libya? Brazil? Venezuela? Enter into a psa in Saudi? Idle threats. And as usual oil companies will lay people off whenever they please to fluff their bottom line. Right now there are record numbers of rigs drilling, barrels produced per day, there are more jobs than can be filled in the sector and the US, as of Feb., is a NET EXPORTER of petroleum products.

JoeW, this whole country should boycott Exxon, along with big oil in general. We don’t need oil like we’re led to believe we do…and at least some of the oil we could use can be obtained by growing hemp, anyways.

Peter, when did AnimuX say “only the Republicans” are bought and paid for by big oil? Oh yeah, he/she didn’t.

LOL!!!
I find it hilarious that some of the idiots on here think eliminating tax breaks will punish the evil oil companies. Eliminate the tax breaks and the cost goes directly to the people filling up their vehicles. Oil companies will slow down exploration as a cost cutting measure, drilling will slow down. Chances are you will be filling up with expensive gasoline, only now you will get to scratch your unemployed backside while you are doing it!!

It will not work. The Oil Companies are notorious about setting up Joint Ventures that purchase smaller companies. In this case they will simply buy up the companies that receive the tax credits, suck the life out of their business and pump the profits back into their own company in the form of Synergies and such to offset their tax liability. Tax these jokers on their overall profit and pump those dollars back in to promote Green Energy, thus getting them out of our pockets forever. Marvin Odem is one to talk. He, Royal Duch Shell outsourced about 10,000 US jobs to overseas Asia Regions in 2010 and 2011 where the average employee paycheck is about $300.00 per month. They don’t even have to pay payroll taxes to the State of Texas. The CEO has been bragging all year of how many US jobs Shell would eliminate and outsource to overseas countries. Many jobs went to Malaysia. They cleared out office buildings in Houston and told more than 1000 people to go home during this time of record breaking profit taking time in history. Most laid off employees were experienced employees with more than 10 years of loyal service to this foreign overseas Oil Giant. This foreign owned company is Anti-American and pumps billions of US Dollars out of the country each quarter. They are not interested in investing in the future of Americans, their interest is purely greed and how hard they can Screw the American people. Shell is not making friends here, trying to be a good Corporate Leader; they are trying to make as many enemies as possible. Take away their tax breaks but also tax them on their overall profits if they want to do business in the US, that way they cannot escape paying their fair share. PS, is there no penalty for Lying to Congress?

I really can’t understand how those of you who support ending oil company tax breaks think that as a result the oil companies will pay more in taxes. It’s simply not true. WE WILL BE PAYING THOSE TAXES!!!!

And Paul, as to your assertion that Exxon has reduced it’s employee numbers every year in the past decade, that’s plain false. In 2006, Exxon had 83,700 employees. By 2010, Exxon had 102,700 employees. That’s a nearly 50% increase in 4 years alone. So, the larger the profits, the more money is passed on to the shareholders (virtually all of whom are middle class) and creates jobs.

Feel free to check out those figures in Fortune Magazines Global 500 list. Lying to support your position leaves you like the Emperor with no clothes, bare, cold, and foolish.

WriterDude… WRONG!!! FAIL!!!
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There are hundreds of websites out there that report that Exxon didn’t pay any taxes for 2009. Those are all based upon a Forbes article which stated that. What none of your sites fail to mention is the retraction written by the author (Christopher Helman) of the Forbes article stating that he didn’t undertand the accounting terminology and that Exxon DID pay billions in taxes in 2009.
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Here is the article: http://blogs.forbes.com/energysource/2010/04/07/exxon-says-it-does-pay-u-s-income-taxes/
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“What the financial statement says is that ExxonMobil, in 2009, after a handful of deferrals, recorded a total U.S. income tax benefit (i.e., a refund) of $46 million. Next to this, it shows total non-U.S. income taxes of $15.165 billion.
My mistake was in thinking that these figures somehow reflected actual tax benefits and liabilities. So what we should have written was that ExxonMobil “recorded” no U.S. income taxes for 2009 instead of “paid.” All you re-bloggers out there, please note the clarification. Mea culpa.”

Nope. I’m not a shill for the oil companies. Don’t work there. Family does not work there. I use gasoline and buy products that move by trucks and boats. The tax code was written by supposedly intelligent people (at least they tell us they are) so one would assume that if the law includes an allowable, it’s not a loop-hole but intended. So what we really have is a group of American businesses (the few that we have left) following the tax laws. Period. That’s it. And the current crop of Democrats, who have no intention of pushing the issue long-term, are yelling not for the extra tax money but for the political gain they hope to make. The reason that American manufacturing (can you say high-paying manufacturing jobs) is now in China and Bulgaria, and Poland, and Vietnam is because of a group of elected officials (both parties) who simply cannot be satisfied with less spending and a smaller government. Oil companies (government reports are available) saw revenues decline in 2009 but recovered in 2010 on the strength of oil futures speculation and now again in 2011 because of a number of international events, including the growth in consumption in those countries to whom we now send our manufacturing dollars. Accordingly, oil companies (are any business for that matter) will send their products to the place where they make the most money. In 2009 and 2010, American Oil companies on average paid as much in taxes as they made. WalMart kicked Exxon out of first place the past two years and I don’t hear anyone calling for an end to the tax “loopholes” for WalMart. But I digress. WalMart gives money to Democrats. In any event, if oil companies are not allowed to deduct certain expenses, their cost of sales will go up and guess what, so will the pump prices…unless of course the U.S. and state governments (can you spell broke?) reduce the per-gallon tax. Either way, we will get it in the end.

Is it any wonder all but 7% of the world’s nations OWN their own oil industry? Only in America can an entire economy be held hostage to a petty few whose profits are highest in history, while the country is being ruined- one-household at a time.

Would it frighten the Oil Execs to think of NATIONIZING them?

Before this is all over, I think the pressure to do so will be very great.

As long as working class fools continue to defend billion dollar corporations and individuals, wealth will continue to concentrate at the top causing the rest of us to compete for an ever shrinking piece of what remains. The only argument here is at what rate does this occur (profit margin). If Republicans have their way they will get as close as they can to having only two groups. The extremely wealthy (probably less than ten percaent of the population) and the workers who will live at or below poverty level. The more power they have the less we will be forced to work for until jobs that once paid decently will be at minimum wage. I work in the chemical industry and I know there are jobs NOW that pay half what they paid ten years ago with little or no benefits. And still you defend corporate profits. Where are our profits? In their pockets. I shudder to think that my kid may have to do the exact same job as I for half the salary because hateful, morons can swing elections.

ntangle
May 12, 2011, 11:28 AM
TransAmer99 wrote: Crude discovery/infrastructure/recovery (getting it out of the ground) 67% or $2.39 / gal
———————-
Right, the money (ie., $100/bbl) that the refining pocket pays the other pocket…(the most profitable one – upstream operations) largely outside the US and US taxation.
======================
You obviously do not have a clue how this is done. The oil companies DO NOT set the price of oil and they mus also PAY to use the output.
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I didn’t say they set the price. But if it’s their lease, they sell it for $100/bbl or whatever. From which the the landowners’ royalty payments (eg., 3/16) and their incremental cost of production (variable expenses) must be paid of course. If it’s a refiner only (which you may be trying to imply), it’s a different story. But the article is mostly about vertically integrated oil companies.

Where was the dog and pony show when GE didn’t pay any taxes? Could it be that GE is a democrat supporter? If they want to do away with the tax breaks. Fine, but do it for all companies. To do other wise is unAmerican.

What I find utterly ridiculous is how people can villify the US oil companies when indirectly, WE OWN THEM. Our pensions, public and private, our mutual and index funds, our insurance companies, our employers, our charities. If you invest anything, something you own is tied to oil.

But go ahead, listen to the very group of people that continue to run up debt and divide us further.

I find it interesting that libs complain that high gasoline prices are the fault of “Big Oil” when it is Obama’s own Energy Secretary who wants US gas prices to mirror those in Europe. You know the $8-10/gallon prices. So what are you libs complaining about? We are only 1/2 way there. And this is the policy you voted for!

Ever notice that Congress is always going after issues, that happen to be their biggest contributors. Dog and pony show, they won’t get anything done other then a bigger contribution to their re-election.

All of you Pundits who wish to only look at DOLLARS ($) do not understand simple economics and will NEVER comprehend that the oil companies make a lot of money on HUGE investments. Their ROI/Net Income is less than 10% of their capital expenditures. Starbucks, Microsoft, etc. are more like 25% net profit on thier capital expenditures but I do not here anyone saying they should not receive tax breaks.

There are people out there that don’t have a glue on economics. I don’t mind the Oil companies getting a tax break, as long as they keep drilling. I thought the idea was to make a profit in business. Then there is room for redevopment and drill more wells.It cost the oil companies to drill a well anywhere from $ 4 Million to $ 10 million onshore. Offshore the price to drill a well is anywhere from $ 20 million to $ 100 million. Where do you think that comes from. I give you a clue. (PROFITS)

ntangle
May 12, 2011, 11:28 AM
TransAmer99 wrote: Crude discovery/infrastructure/recovery (getting it out of the ground) 67% or $2.39 / gal
———————-
Right, the money (ie., $100/bbl) that the refining pocket pays the other pocket…(the most profitable one – upstream operations) largely outside the US and US taxation.
======================
You obviously do not have a clue how this is done. The oil companies DO NOT set the price of oil and they mus also PAY to use the output.

It funny how nobody here seems to realize they can tax the Oil Companys all they want, and probably will, but the consumer will be the one actually paying for it. Let them drill for our own Oil and prices will drop over night, just by saying the simple words. Then the govt. can charge us more on the federal tax, because that’s all their trying to accomplish anyway. Just trying to put the blame somewhere else, which I agree they make too much money, but the consumer is the only one that will actually pay for it in the end.

I would like to know if Sen. schumer would choose between receiving his salaryor contributing it to keep federal student air programs funded. Or perhaps a more imporatnt choice would be between sacrificing his senate seat to keep that funding – what a hypocrite!

Viejo…over the last decade, Exxon has enjoyed every one of the top ten quarterly profits in history (and then some). Over that same time period, Exxon’s total workforce has decreased EVERY year. If you’ve been paying attention lately, it’s not hard to notice or find the escalating income gaps between CEO’s/corporate executives and average American workers. In 1980, the average CEO made about 20 – 30 times more than the average worker. Now, that number is about 300 – 400 times more…yet…look at our current job situation. I don’t know how or why anyone can honestly attempt to make the argument that profits = jobs anymore.

Mark and denmond…profit margins aren’t relevant at all. I love how the argument/excuse for oil execs raking in record profits…especially during times like these…goes to the “but if you look at the PERCENTAGE of these oil profits when compared to the PERCENTAGE of profits from other companies” card. Yes…OF COURSE…some things will have higher “profit margins” than others given that some products are more/less abundant than and/or cost more/less to make/build/assemble/buy/sell than others. When the CEO of, say, Exxon wants to buy his 9th mansion (or really ANYTHING at all), the seller isn’t asking for his or her pay or profit “margin.” They’re asking for a NUMBER. Same goes for you and I…except the 9th mansion part. We buy things based on PRICE, not something like whatever our percentage of income is when compared to others. Judging by your (denmond’s) statement (8-10% profit margin isn’t big profits), you’d think that Exxon’s current (roughly) $120 million every DAY in profits “isn’t big profits.” The TRUTH is, that’s a bunch of B.S. If record profits “aren’t big profits” to you, then you’re being played like a cello. Also Mark, corporations are supposed to pay taxes in this country. That’s why there is a corporate tax rate. You’re right, however, that they don’t…at least about 2/3 of them. I’m gonna go out on a limb and “assume” that the hundred of billions of dollars (maybe trillions) every year that most of our corporations avoid paying is a “bad” thing…and is also maybe…just maybe a major contributing factor as to why this country is bankrupt.

No Jay Rockerfeller, you’re the one out of touch. Worse, you’re the biggest hypocrit of the bunch because all your personal wealth came from original Standard Oil Company formed by your ancestor John D.

Why do you liberals think that money anyone else earns is there for you to use?

Mike – why do liberals like perpetuating poverty so much? The US should tax to match other countries (or if smart a little less) to encourage business development = more jobs = more taxes to pay for the hand-outs the liberals love to give.

I love to see the GOP apologists for the Oil companies who are making record profits (35 billion in 1st quarter alone) all the while saying the elderly and the poor must pay more through welfare cutbacks. It’s ok to give welfare (subsidies) to oil but not to the poor and elderly.
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Truly, these fake christians need to get on their knees and bow down to their corporate Dear Leaders.

In response to the person who thinks diesel is a free by product of refining gasoline. Are you a chemical engineer who knows the process by which you produce the low sulfur diesel required by the EPA? YOU DON’T KNOW ANYTHING ABOUT WHAT IS REQUIRED TO PRODUCE ANY PETROLEUM PRODUCT. I have come to hate all the so called experts that can’t see past their bias against the oil companies because they believe the stupid politicians and media. Go back to the horse and buggy if you don’t like cars, ride a bicycle or walk. Leave me to my 400 hp truck with the gun rack.

There is no such thing as a tax break. That’s a dumbed down way of looking at taxes. What is in the student aid package that the Senator is trying to give away. For if the student is to pay it back then there would be no need to even have a discussion of taxes. I believe the public is being lied to and don’t understand what they are being propagandized to be mad about. Danged polotics and a Senator who answers for nothing but to get votes.

To which the oil executives should respond, do you want those same children to have a job someday? Keep raising the US tax rate above the world tax rate on oil & gas and all future investment decisions will go to countries (i.e. China & India) that aren’t trying to discriminate against one industry over others.

TransAmer99 wrote: Crude discovery/infrastructure/recovery (getting it out of the ground) 67% or $2.39 / gal
———————-
Right, the money (ie., $100/bbl) that the refining pocket pays the other pocket…(the most profitable one – upstream operations) largely outside the US and US taxation.

“Senator asks oil execs: What’s more important, student aid or your tax breaks? ”
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To which I would reply, ” What’s more important, providing jobs here and having affordable oil or encouraging anchor babies to suck at the government teat for tuition?”

these corp executives, have been giving us the shaft for higher oid prices. “world demand, weak dollar, summer months, annual oil rig maintenace, speculators, higher cost for exploration, etc. When do these guys with the bankers, the morgage freaks, the corporate lawyers go to jail. Enron was their pappa teacher, and they are still using that example for their lying. Stock holders can kiss my ….Send them all to jail.

And Tom, perhaps you’d like to try and purchase gasoline elsewhere… like in London where the price is the current equivalent of $9.76 per gallon. Tell us again how the ‘evil oil companies are screwing the U.S. consumer’? Get the facts first.

We are talking about 2 Billion a year in closed tax loopholes for big oil. But remember, this is spread out over all the oil companies. In 2009, on earnings of about 45 Billion, Exxon paid no taxes at all.

“Exxon tries to limit the tax pain with the help of 20 wholly owned subsidiaries domiciled in the Bahamas, Bermuda and the Cayman Islands that (legally) shelter the cash flow from operations in the likes of Angola, Azerbaijan and Abu Dhabi. Of $15 billion in income taxes last year, Exxon paid NONE OF IT to Uncle Sam, and has tens of billions in earnings permanently reinvested overseas.” (from ThinkProgress)

Baren, your company will never earn a “big profit,” because it is clear you do not understand the fundamentals of business. More money for your business means that your business can grow and prosper. If you are truly interested in your business’s success, you will find every way to reduce costs and expenses–including tax breaks.

You are looking at exactly what these Senators want you to look at: revenue. But what you fail to understand is how expensive it is to operate one of these businesses. The oil and gas industry–especially the supermajors–operate a very small net profit margin, usually 6% or 7%. That means for every $100 they make in total revenue, only $6 is profit. Do you think that’s obscene? Do you think that’s immoral? Compare that to Google, which has a net profit margin of 25% or some financial services firms that have net profit margins of 60% ot 70%.

The reason these politicians can get away with this is because they play to the base envy and jealousy of the public, like you. And the average person won’t bother to actually investigate their claims, so they just accept them. That’s unfortunate.

Many of you posters will not be happy until all major oil companies leave the US for greener pastures. After that you will be very, very unhappy. Sort of like jumping from the frying pan into the fire, or cutting off your own nose to spite your face. What is driving this animosity?

Over the past five years, ExxonMobil alone incurred a total U.S. tax expense of almost $59 billion, which was $18 billion more than they EARNED from U.S. operations during the same period. That money goes back into the economy…for everyone. You ought to be glad they’re getting screwed. For now. Because when they are put out of business, we all lose.
So be careful what you wish for, because if they don’t have money to find more oil that YOU need for everything, you will see a ruined U.S. economy and will BEG them to come back; if they can. So go ahead, cut your own throats.

“The bill also would limit the deduction of certain tertiary injectants, chemicals used to boost the amount of oil and natural gas that can be recovered from individual wells. Currently, companies are allowed to deduct the cost of those injectants, but the bill would force the big five oil companies to instead capitalize those costs and recover them over time.”
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Might as well start asking the airlines to start capitalizing their expenditures on Jet Fuel instead of expensing it. It is essentially the same thing Congress wants to do to ONLY 5 oil companies.

You walmart republicans stagger the mind….these companies are making so much money its obscene…Exxon is already making 79% more this quater than it did the same time last year….and every cent they pay in “FOREIGN TAXES”…which is a code word for paying royalties to the countries they pump oil out of is reimbursed in the form of tax brakes…as in 100% reimbursible…these companies get so much GOP welfare, its disgusting…and do you know why they won’t leave the US to drill? Because they CAN’T…They talk a good game, but there are very few places left to drill and exploit outside of the U.S. …Because state owned oil companies gets first strike at reserves found elsewhere..which puts them at a disadvantage..so they will screw the U.S. consumer to make up the difference…make them pay taxes like the rest of us…they don’t have these long winded debates anywhere else but here….if they want to dance in another country, they pay the band…make em pay here, as well…the prices won’t go up unless we allow them to…

The oil companies contribute over a TRILLION dollars annually to the economy and the subsidies they receive are a drop in the bucket compared to what the Democrats subsidies for green energy which contributes ZERO to the economy.
Dem’s give green energy $24 for each megawatt produced while they give coal .50 cents for each megawatt produced. The Democrats have always tripped over dollars to pick up pennies… and then they blame it all on someone else.

The thing that gets lost in all this uproar over “profits” is that a large part of the “profits” get reinvested in the companies to fund future exploration and development projects. In other words, today’s profits is tomorrow’s oil.

Corporate blackmail. That’s all it is. If you raise taxes, we’ll raise the prices and blame it on the goverment until the people vote you out of office. So give us our tax breaks and you might keep your political position.

I cannot fathom those who defend these huge oil companies who are making billions in profits (this has been established by non-partisan examination, when we continue to give them tax breaks. Do these people disbelieve that the wealthy pay less tax than the ‘ordinary, hard working’ citizen? It is a ridiculous situation, but Oh wait, it is because these same oil companies line the pockets of the politicians who make this possible (both parties). Enough, as the nation struggles to recover economicaly.

20% of the people in the US owns 85% of the wealth. And no, they did not “earn” it by “working hard”. They obtained it mainly by moving capital around, mostly in unproductive ways. No one gets rich in the US by working. Ask a miner or a stock clerk if they work hard. To suggest that the problem with the country is that poor people do not pay enough taxes is viscious.

“Executives from the nation’s five biggest oil companies are telling a Senate panel this morning that they should not be blamed for spiking crude prices…” No, the “speculators” are responsible ( heh, heh, heh )! WE JUST GET TO REAP ALL THESE OBSCENE PROFITS BECAUSE OF THOSE HIGH PRICES! ( In other words, WE BENEFIT but it AIN’T OUR FAULT! But, YOU STILL LOSE! )

Ignorant people keep saying rich people and companies need to pay their fair share of taxes. What exactly do they think they are saying. A married couple with 2 kids making $50,000 a year who spends all their money on personal non deductable things gets their taxbale income reduced by an $11,600 standard deduction and four $3,700 exemptions thats $26,400. So the poor family gets a greater then 50% reduction in their taxable income for absolutly nothing. Their marginal tax rate is 15%. How is it the rich don’t pay their fair share. Every $50,000 of profits these companies make are taxed at least 35% for federal income tax not to mention all the state and local taxes. Perflectly fair shares of tax would be a flat tax. Let’s play fair and tax the poor at the same rate we tax the rich. Hows that for fair. At least you ignorant people should stop saying they need to “pay their fiar share” and start saying they need to “pay more of my share”.

That is just greed on the oil company’s part. They make big profit and want to keep it all.
If my company made a big profit I would be glad to pay my fair share of taxes not threaten congress .The CEOs should be taxed at 50 %.
No one needs billions in salary and bonuses each year.Just plain greedy people .
Hope they all burn in hell someday for what they are doing to the world.Its GODs oil after all.

It’s incredible to me how many people live in Houston that make these ignorant comments about oil and gas, yet our very economy and most of our jobs…local and statewide, depend on it. Didn’t you even read the article here? Oil and gas companies are huge; but the difference in “profits”, that you people think are so bad, are about average for most businesses. If you wanna see some real “profits”, look at big pharma…then you’ll see who’s screwing who. Frankly, I don’t think you whiners have the brains to figure out the math. And for what these companies give us in end product, we all benefit, whether you want to believe it or not. Get a clue.

Funny, we don’t have issues with Politian’s making millions off kick backs from the lobbyist and unions. We don’t have a problem with entertainers making millions and hiding their money in offshore accounts so they don’t pay taxes. We don’t have a problem with athletes making millions; we don’t have a problem with Apple making millions with 24% profits. But for some reason we always have a problem with “BIG OIL” they employ more people than any other industry in the US, they pay higher wages then any other industry, they offer better career advancement than any other industry. Oh Yea, and as an industry, they contribute more tax dollars. What a bunch of jerks. We need to shut them down so we can’t drive our cars or use any of their nasty petroleum based products like the computers and key boards we use to type these e-mails and all the other petroleum based products we use to get our green message out there about the evil oil companies.

These men have more money than I do, and I don’t think that’s fair. Therefore, these men are evil. Therefore, the companies they run are also evil. Therefore, we should take more money from them in the hopes that that will make them less evil. And then we should give that money to other people who might want it…like me. Why is it so hard to understand this logic?

Okok, we’ll just place a cap on all of them…let’s see, hummm how about 200 billion. That should be enought money for them to still feel rich while the rest of the regular folk are burden down with higher prices on everything.

American tax laws now mean that middle income Americans are paying a far larger share of the country’s total tax revenue than they were 50 years ago.
____
Wrong, the high income earner pays the majority of taxes in the country and raising taxes on the rich won’t solve the deficit issue.

There they go again in Washington, doing everything they can to drive companies and JOBS overseas. Why should these oil companies devote themselves to staying in the US when the Obama Administration is doing everything it can to stop offshore drilling and to remove incentives for companies to do business here? These companies can move on to South America, Africa or other regions of the world and take the jobs with them. Way to cut off our noses to spite our faces, huh Congressmen?

The Republicans in the House will block any attempt to curb corporate socialism.
So what that means is open up your wallets middle class.
Based on some of the arguments here regarding taxes being passed on, how about lowering the tax on the working Joe, which by the logic given here, would lower the price of labor to the corporations and thus make them more profitable.
Hogwash I tell, pure greedy corporate hogwash!

Here’s an article examining just how the tax system in the United States is favouring both high income earners and the country’s largest corporations, some of whom pay no taxes at all despite multi-billion dollar profits:

Only takes $1.10 to produce, transport and $0.10 markup at the pump a gallon of gas while oil is at $100/bbl. The rest is profit. The most rediculous of the fuel is diesel…it is a BY-PRODUCT while refining oil to make gasoline. A BY-PRODUCT thet they charge $4.00 for something that comes naturally (free) from the process.

Waves – actually, because taxes are paid by the consumer, not the company, ALL corporate taxes hurt the poorest of the poor.

All – did you know that there are more than 20 different formulations of regular unleaded gasoline? Multiple cities/municipalities require certain additives that they think makes the gas more environmentally friendly, causing each of the refining companies to make multiple formulations of regular unleaded. So, the regular unleaded gas you buy in San Francisco is not the same regular unleaded gas you buy in Denver. Those specialty formulations are the most profitable gas refiners make.

How about ONE set of requirements nation wide for regular unleaded?!? I can promise you, that alone would drop the price of a gallon of gas by $.25 or more. The irony is that the liberal wackos who don’t have a clue about business are the very ones responsible for a significant portion of oil company profits with their loopy environmental requirements on the formulation of regular unleaded!! Hysterical!

Foggy headed folks. Please try to understand. Taxes,fees levied on any person, entity, living or dead is paid by ALL. IMO this particular tax increase will certainly drive away more good paying jobs that folks especially in this region depend on. Stop raising fees on the backs of America. She is choked to her knees, let her get her breath. Cut spending % across the whole board. 15% the first year would be a good start. 15% the next and before long the economy will recover and payoff big time.
The longer this is put off the more painful(to unbearable) it will be.

Last year Exxon made six cents a gallon in profits, and 80% of their revenue was outside the US. Meanwhile, state and federal taxes were more than 75 cents per gallon. Politicians are good at deflecting, aren’t they.

In response to Mark’s comment, one could also question the logic of saying that in an era where EVERYONE is tightening their belts that the oil industry should be exempt. In an industry that has reaped nearly $1 TRILLION in profits this decade, removing tax breaks amounting to $21 Billion over 10 years seems like a small sacrifice to make…unless you are an oil industry CEO.

I have a question for all 5 of these crooks – what is your compensation package, money, stocks, etc? Then what is the compensation package for all execs in your company? After answering that question I would then ask exactly why they deserve tax breaks when they personally as well as their respective companies obviously do not need any government incentives, in fact they can more than afford to pay their fair share of taxes, they in fact do not need a tax break. If we want to give someone a tax break, lets give tax breaks to the poorest of poor, not the richest of rich. It baffles my mind that we seem to punish the poor and reward the rich, seems like we have that backwards –

Look at what the deductions are for, spending $$ on US production, and it’s pretty obvious why they get tax breaks. Besides, every penny gets passed on to consumers or the companies go out of business.

2) The oil CEO’s aren’t there to defend their profits, but rather against a proposal to specifically tax them more heavily then others in their industry as well as other industries.

3) The only effect that increasing the taxes on the majors will have will be in the reduction of investment that they can make which includes jobs that go with those investments. Long-term that means the reduced competitiveness of the majors who will further cede market share to the foreign national oil companies, further increasing our dependence on foreign, imported oil produced by companies such as Petrobras, Saudi Aramco, PDVSA, all of which DON’T pay a dime in US taxes, DON’T employ US workers, DON’T pay US royalties on the oil they produce, but collect just as much from US consumers for their oil. The democrats current posture with regards to the US oil&gas industry is backasswards….

Those lobbyists for the petroleum industry have got a nest egg they don’t deserve. The research and development of hydrocarbon assets should be a cost of doing business and not an entitlement from taxpayers, as government doesn’t make any money, they just steal it from profits of wage earners.

Now we poor voters voted for president Obama since he campaigned on soaring energy prices. Higher energy prices apparently hurt the rich and help the poor on welfare food stamps unemployment socal security and SSI, particularly illegals on SSI. See we poor voters like higher prices so don’t messin with that now.

Obama promised us energy prices would soar because of his cap and trade but he has had to switch gears and use regulation and hence he appointed our well renowned communist Harvard law professor regulation CZAR Cass Sunstein.
Here he is in his own words on energy soaring prices.

Their profits are very very reasonable. Anyone who says a 9% profit margin is too high, either doesn’t know a lick about business or just hates the capitalist system.
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As far as taxes go, the consumers pay for it one way or another. We either pay at the pump if we remove the tax breaks or we pay higher taxes if we keep them. The only way to truely reduce the cost to us is to reduce spending. Shifting taxes does nothing but satisfy the ignorant and the lobbyists and politicians who get rich.

Americans need a reality check on gas prices and mass transit. Gas should be $6 a gallon, with $2 of that going to rail transit and renewable fuel research. This win/win would decrease obesity by forcing fat people to walk more. It would also decrease carbon emissions and gridlock. Wake up, stupid, super-sized, lazy americans, the world is choking on your petroleum-based flatulence.

Millionaires arguing for tax breaks when the economy is tanking, the country is facing massive deficits, and oil prices (and profits) are through the roof. Tax those suckers who are buying the gas, not us poor millionaires! Why not, the Republicans have been making that argument successfully for over 30 years, which is why we have deficits here in Texas and nationally.

First, corporations don’t pay taxes, consumers do. If the oil companies were required to pay more in taxes, it would be passed to the consumer, and won’t come from the profits.

Second, corporate profits do two things, they pay shareholders who own the company (by way of dividends) and create new jobs. Since most public and private retirement funds own energy stocks, most Americans reap the rewards of energy company profits. The Democrats failure to understand this simple concept is why the economy is in the tank and shows no signs of recovering any time soon.

Third, this bill is much ado about nothing. It has zero chance of passing the House, assuming it makes it out of committee in the Senate and is passed there. This is nothing more than political grandstanding.

take the tax money and give it to someone who will develop the alternative energy research and development that doesn’t have a special interest in the current energy source, and their bread and butter: oil.

“Question: Can anyone say approximately how many profit would be left after paying taxes?”
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Yes — exactly the same profit that exists today. Because the oil companies will simply pass the new tax on to YOU – the customers, so they can meet the obligation of their existence — which is to make a profit. They are not in it for the fun of it.
I have an idea, why don’t we make swipe-able voter registration cards and require them to be used at the pump? Then we can charge the taxes to the democrats that want them and let everyone else live in the real world.

Wow, where do you start with this. It is news, but for some reason it is reported in a blog, presumably to escape from the old fashioned “who where what why” basics of journalism. The premises are so flawed from the start — a blog called “Fuel Fix” which implies an addiction to fuel and shows the bias out of the starting gate — and then a blog post that starts with the premise that it is somehow bad for oil companies to make a profit. The reality is that oil companies make a much smaller percentage of profit than many other industries, but that fact escapes those who have a bred-in hatred of business and especially oil. Also completely absent from the perspective is the fact that coporations DO NOT PAY TAXES — CUSTOMERS PAY TAXES. A tax increase on Shell (for example) is automatically a tax increase on YOU — the customer. They will simply pass it on to you. One must seriously question the logic of a reporter or a politician that proposes raising energy prices at this moment in history.

“Ya see there Chairman, we make a lot of money off the American people so we deserve a big profit. By the way, any you Republicans got anymore of those tasty tax breaks laying around? We need them bad!”

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